SEBI Partners with DigiLocker to Reduce Unclaimed Assets, Boost Investor Protection
The Securities and Exchange Board of India (SEBI) has joined hands with DigiLocker, a government-initiated digital locker facility, to minimize unclaimed assets in the Indian securities market and improve investor protection. The move, announced on Wednesday, will allow investors to keep and retrieve their demat and mutual fund holdings on DigiLocker, to the advantage of themselves and their families.
As per SEBI’s circular, DigiLocker users can now fetch and store their statement of holdings for shares and mutual fund units from their demat accounts, along with their Consolidated Account Statement (CAS). This move expands DigiLocker’s existing services, which already include bank statements, insurance policies, and NPS account statements.
One of the most important aspects of this integration is nominee access. Nominees can be added to investor accounts in DigiLocker, giving them access to vital financial documents once the investor passes away. This will facilitate easier management of inherited properties for family members or legal heirs.
Also, DigiLocker will update the status of an account in case of an investor's death by cross-matching death certificates or data furnished by KYC Registration Agencies (KRAs). In this case, DigiLocker will automatically inform nominees through SMS and email, simplifying the passing of assets with financial institutions.
SEBI has instructed asset management companies (AMCs), registrars and transfer agents (RTAs), and depositories to get registered with DigiLocker so that investors can retrieve mutual fund and demat account information. KRAs will also provide investor death data to DigiLocker to enable hassle-free asset transfer.
The move is intended to minimize unclaimed assets due to dormant accounts, outdated contact information, or cumbersome transmission procedures. SEBI has urged investors to make active use of DigiLocker and appoint nominees to effectively handle their assets.
The circular will be effective from April 1, 2025. SEBI had previously released a consultation paper in December suggesting the utilization of DigiLocker to address unclaimed securities assets.
